Prevention of T2DM is a critical and attainable goal Interventions to prevent or delay development of T2DM in those with prediabetes have focused on reducing insulin resistance via lifestyle modification, the use of insulin lowering medications, or both. The introduction of incretin therapies, e.g., GLP agonists, makes it possible to determine if similar or superior outcomes can be achieved with strategies to preserve or enhance insulin secretion. The overall goal of this randomized clinical trial is to determine whether the expected augmentation in insulin secretion imparted by administration of liraglutide will be enhanced by the co-administration of pioglitazone, an insulin sensitizer that will "unburden the beta cell" and preserve beta cell function. This combination will be compared to liraglutide+placebo to determine whether the effects of pioglitazone, if any, are additive to or synergistic with those of liraglutide. A unique aspect of our approach is that, whenever applicable, CPAP treatment of OSA, an independent risk factor for insulin resistance, will be incorporated into the treatment paradigm and will serve as a covariate in the analysis of the response to pharmacologic therapy. All participants will be assessed at baseline and 26 wks post-treatment with: a 75gm 5-h OGTT analyzed by the modified minimal model, an isoglycemic glucose infusion to estimate the incretin effect, a fsIVGTT to estimate AIRg and Si, and a graded glucose infusion to assess beta cell function. We will target individuals with high rates of prediabetes and T2DM: adults with a first-degree relative with T2DM, women with a prior history of GDM, women with PCOS, and overweight and obese individuals aged >45 yr. The following Specific Aims will be addressed: Specific Aim 1. To determine if 26 wks of treatment with liraglutide+pioglitazone is superior to liraglutide+placebo in improving insulin secretion in individuals with prediabetes or recent-onset T2DM. Specific Aim 2: To determine if beta cell responsiveness to two different modalities of pharmacologic intervention (liraglutide alone and liraglutide+pioglitazone) is modulated by the presence of OSA and by African-American race/ethnicity. Specific Aim 3: To determine if treatment of OSA by CPAP preserves or enhances beta cell function in the absence of pharmacological treatment and if the impact of OSA on insulin secretion and action is modulated by race. Specific Aim 4: To determine if 26 wks of liraglutide+ pioglitazone is superior to liraglutide+placebo in extending the durability of drug treatment on beta cell function. PUBLIC HEALTH RELEVANCE (provided by applicant): The proposed studies in this application bring a new dimension to the evaluation and understanding of the role of the beta cell in the pathogenesis of prediabetes and T2DM. Innovative aspects include the choice of the drug combination to be tested;detailed simultaneous assessment of the main components of glucose tolerance (beta cell responsiveness to oral and intravenous glucose challenges, insulin sensitivity, and incretin effect);and lastly to the critical evaluation of OSA as a modifier of inulin secretion and insulin action among subjects predisposed to develop T2DM. NOTE: The critiques below were prepared by the reviewers assigned to this application. These commentaries may not necessarily reflect the position of the reviewers at the close of the group discussion or the final majority opinion of the group, although the reviewers were asked to amend their critiques if their positions changed during the discussion. The resume and other initial sections of the summary statement are the authoritative representations of the final outcome of group discussion. If there is any discrepancy between the peer reviewers'commentaries and the numerical score on the face page of this summary statement, the numerical score should be considered the most accurate representation of the final outcome of the group discussion.